While the U.S. equities market is having a strong year, international stocks are the more promising investment play, according to Jeffrey Kleintop, Charles Schwab’s chief global investment strategist. “International stocks are outperforming U.S. for the second year in a row, and I think the thesis behind that is the U.S. is really [centered] on seven stocks. We hardly look beyond these seven megacap stocks that are driving the market,” Kleintop told CNBC’s Bob Pisani on Monday in an interview at the Future Proof wealth festival. “I think if you look beneath that, you see the start of a new trend and a new cycle with very different characteristics, that are rewarding companies with strong cash flow, not those that can borrow for negative rates,” he added. Kleintop highlighted European equities. The “terrible” investor sentiment for international stocks has created a promising buy-in point for investors, said the strategist. He noted Germany, the regions largest economy and manufacturing powerhouse, is now undergoing a recession . The ongoing war in Ukraine, fiscal austerity measures and pandemic aftermath have dampened the performance of broader indices — but the average stock in Europe is doing better than in the U.S., the strategist said. “Expectations are very low. Valuations are very low,” said Kleintop. The strategist added that in addition to the equity opportunities outside of the U.S., investors ought to consider bumping their bond allocation a bit higher. “I often get the question, ‘How much should we have in bonds now?’ The answer is probably, no matter who you are, probably a little more than you have now,” said Kleintop. “That’s not to say you should have your entire portfolio in fixed income right now because we do think there are some equity opportunities increasingly outside the U.S.,” he added.